Falconbridge cuts new nickel in Brazil

Wide-spaced drilling by Falconbridge (FAL-LV-T) has turned up two significant nickel deposits on the Araguaia nickel laterite properties in the north-central Para state, Brazil.

Since October 2004, some 288 diamond drill holes (totalling 13,536 metres) have traced the north-south trending Serra do Tapa deposit over 5 km. The zone remains open at both ends, and varies in width from 800 metres to 1.5 km, with the eastern boundary not yet completely delineated.

So far, complete assay results are in for 160 drill holes, with 116 of these yielding more than 1% nickel over intervals of at least 2 metres. The holes also indicate an average overburden depth of 10.5 metres.

Better results include the following:

• hole TC09-560-160 — 61.7 metres (beginning 1.8 metres below surface) running 1.7% nickel, 12.8% iron, 0.02% cobalt, including 30.4 metres (from 2.6 metres) of 2% nickel, 14.3% iron, and 0.03% cobalt;
• hole TC09-640-160 — 93.4 metres (from 2.7 metres) averaging 1.73% nickel, 21.9% iron, and 0.08% cobalt, including the first 54.9 metres containing 2.2% nickel, 12.82% iron, and 0.04% cobalt; and
• hole TC10-160-320 — 39.3 metres (from 4.3 metres) grading 1.8% nickel, 15.3% iron, and 0.04% cobalt, including the first 19.4-metre interval running 2.2% nickel, 10.9% iron, and 0.03% cobalt.

Falconbridge says the deposit is characterized by exceptionally thick laterite profiles, especially in the northern portion where the weathered zone exceeds 100 metres.

Some 10 km to the southeast, 4,257 metres worth of drilling in 152 diamond drill holes on the Vale dos Sonhos deposit is highlighted by:

• hole FCZ-04-24 — 14 metres (from 8 metres below surface) averaging 1.9% nickel, 13.5% iron, and 0.04% cobalt, including the first 7-metre stretch of 2.7% nickel, 19.1% iron, and 0.06% cobalt;
• hole SJ25-160-480 — 14.4 metres (from 3.6 metres) containing 2.1% nickel, 28.1% iron, and 0.1% cobalt, including 8.9 metres (from 5.8 metres) of 2.6% nickel, 30.5% iron, and 0.1% cobalt;
• hole SJ25-480-480 — 11.7 metres (from 1.8 metres) grading 2.8% nickel, 28.2% iron, and

0.15% cobalt, including 9.3 metres (from 2.8 metres) at 3.2% nickel, 28.7% iron, and 0.17% cobalt.

Both deposits also yielded between 8% and 24% magnesium oxide.

So far, Vale dos Sonhos has been identified over 4 km in a north-northwest trending zone ranging in width between 600 metres and 1.2 km. Some 69 of the 116 holes assayed have yielded more than 1% nickel over at least 2 metres; overburden thickness averages 4.6 metres.

Initial results suggest the mineralization is predominantly a mix of saprolite and transitional nickel laterite, with a minor limonitic component.

The north-south trending, 90-km-long Cinzeiro ophiolite complex hosts both deposits. Falco says the geological setting is similar to those at its Falcondo operations in the Dominican Republic and all of the large deposits in the New Caledonia.

Both deposits occur on land already owned by Falconbridge or land that the major can pick up by paying a total of US$2.4 million over eight years.

Falco is in the midst of halving the drill line spacing to 160 metres, with an ultimate goal of closing the drill hole spacing to an 80-metre grid in anticipation of tallying an inferred resource ahead of an economic scoping study slated for early 2006.

Based on recent airborne surveying, Falconbridge has acquired additional ground to bring its holdings to 3,800 sq. km, and has applied for another 2,000 sq. km of little-explored land along the belt. Evaluation of several targets is ongoing.